Endesa earns 3% more until June thanks to the liberalized business

Total production in the period was 24,658-gigawatt hours (GWh), 14.1% less than in the first half of 2018

The electric company Endesa has obtained a net profit of 776 million euros in the first half of 2019, 3% more than in the same period of the previous year, thanks to the management of the liberalized market, the stability of the regulated and the effort in cost containment.

As Endesa reported to the National Securities Market Commission (CNMV) on Tuesday, gross operating profit (Ebitda) increased 5% to 1,894 million euros, while revenues fell 1% to 9,791 million.

The total output in the period was 24,658-gigawatt hours (GWh), 14.1% less than in the first half of 2018, as a result of decreases in the hydraulic production and coal, which have fallen 47% and 48%, respectively.

The CEO of Endesa, José Bogas, who has said that the two main engines of the company’s investments are renewable energy and digitalization, has highlighted the portfolio of new renewable projects that can reach 9,000 megawatts (MW) and He added that this strategy reinforces the results obtained and places Endesa “in an advantageous position to lead the energy transition” .

Endesa has explained that its strategy in the liberalized market has allowed it to increase the EBITDA of this business by 21 %, reaching 745 million euros, and the gross margin of the liberalized business has increased by 104 million euros, 8, 5%, thanks to the improvement in reference prices, which has more than compensated for the increase in CO2 costs, the reduction in sales and the decrease in hydraulic production .

Also Enel Green Power Spain (PFGE), the renewables subsidiary Endesa has obtained a margin of 150 million euros, mainly due to the consolidation of facilities acquired Gestinver and gas business improved its margin, which has increased by 35%, reaching 89 million euros.

The Ebitda of the regulated business (representing 60% of Endesa’s total) decreased by 3%, to 1,149 million euros due to the decrease in the generation margin of the non-peninsular territories, although the margin of the distribution business increased in the semester 1% in the whole territory.

Fixed operating expenses have been reduced by 4% in adjusted terms (6% in reported), despite the strong increase in investments in renewable energy.

Gross operating profit (EBIT) grew 4% in the first six months of the year, to 1,100 million euros, and gross investments soared 72.6. %, up to 956 million, for the development of new wind and photovoltaic power and digital transformation actions.

Net financial debt increased by 18% compared to the one at December 31, 2018 (1,025 million more), due to the entry into force of the new IFRS 16 accounting standard, which has led to an increase of 186 million in net debt; investments in renewable generation and the payment on January 2 of the dividend on account charged to the results of 2018 for an amount of 741 million euros.